i want to thank our guest host today the hour flew by thank you. we're out of time. keep an eye on the markets and listen to what jim cramer has to say next we hand it to "squawk on the street" right now. ♪ ♪ >> good wednesday morning. welcome to "squawk on the street." we are looking for some signs of exhaustion after 2, 3% down days on cornerna virus fears. futures did crack below 3100 but higher yields. europe is fighting

oil did crack below 39 the s&p 500 suffering its worst two-day slide in 4 1/2 years and stocks look to bounce slightly before the open. it is a new era for disney bob iger has stepped down with a lot of questions, of course, why now? >> techs tanking in correction territory with high names like alphabet, apple, amazon losing a combined 4 million on consecutive sessions the state department wiped out $1.7 trillion in gains markets down 6% and jim, 7 on the s&p, you think might be time to do something. >> it's interesting. you have to buy something. the cluster they find in america, i say it that way, got the green light to say it from

the cdc and possibility of an ebola situation, remember, we lost someone in texas. that was a problem in texas. would something like that here be shocking? we lost 14,000 people from the regular flu and perhaps the new flu and respiratory illness, it's certainly possible. you will read everyday about somebody new and some new area, because the nature of the beast, it's so easily caught. the uk direction saying you have to be six feet away. it's easy to catch it's worse than the regular flu. we had 50 million people with the flu in america perhaps 100 million with this. >> we tried to delineate the difference between the public health aspect and corporate economic activity aspect today, we hear from a long list.

>> we don't know we're not doctors. i think you have to start by saying here's what the cdc says, supply chain bad, economy obviously weak then, you get into a situation you have a tjx reporting a great quarter. do you just disregard they reported a great quarter i don't think so do you file it away? i can look at these stocks and say how many affected. do any in travel affected? everybody cuts numbers some of these other companies. i was talking to mark in salesforce yesterday was step-down tuesday. >> is that what it was >> stepdown tuesday. let's just say, do you just want to hate the market as much as you did minus 7% and haven't bought anything? i can't. my travel trust, 21% cash, not that i'm a genius.

i notice the highest >> that's like buffet. >> the only time i've ever been -- actually, "fortune" compared me to buffet. me and karen >> i'm not sure that's a specious comparison? >> because karen and in broke up hi, karen, i know she watches the show >> it is coming to this country and will be a disruption as the cdc indicated. we will see corporations curb travel >> the economy will slow i think some companies will reflect that the stay is negative, down 7%, staying as near as positive, up 7% >> what david is asking, why wouldn't you wait for these warnings to come when you know they're coming

>> okay. i know you want to wait for the warnings to come i had a transition on step-down tuesday. they got hit and cut numbers they already told you things will go down, then you have to say, you know what, even when they warn and get it over with, things can go lower. i'm just saying, if you have a lot of cash, 20% cash, not putting 1% to work are you really going to think nobody has anything going on there were two federal government things yesterday. national su za health with a hug your children thing. i thought that showed bad leadership >> and then talking about it, bo gilead, the first to say, this thing is coming here

things are happening and good. i'm beginning to believe in the science. there is some risk that they do something good and you have bought nothing the first shoe, we've got real problems, we get the cluster, okay the second shoe, we get a death, all right? >> so you've got piling can goods and water the way a lot of my hedge fund buddies are in second and third homes, they should be buying stocks? >> we already did that >> jim already grows his own food >> i grow it from seed worried about fungus >> he can choose from around the world where it is he's going to go, although you have to get on a plane which is probably not something you may want to do >> david, it's not about me. yesterday i announced i was somewhat crazy i mentioned an animal that was really part of this epidemic >> part of the corona virus. >> if you haven't put anything

to work, i think you're playing with fire. i would say put it all to work if i don't have to sell the shoes. i'm beginning to hear a different tone from people like vallci, who are saying it's coming early on, no minced words. and then mench's gillaac and moderna. i've been with them since they were working on a vaccine for cancer dial up a possible vaccine obviously, a vaccine, you just don't turn it on i will give you one. regeneron changed its tune it had the cure for ebola. it is saying, hey, look, something on the horizon, we'll be okay. i can't be as negative i know macy's is jarring

yesterday. they gave you a corona virus let's listen to tjx. maybe they don't give you the caveat i come back and say, if you bought nothing look at that top name. >> nothing to do with the corona virus. >> that's a mental virus >> 120 odd things. >> let's not be too personal, david. >> stay away from me with your homonym attacks, please. >> i didn't mention a name am i optimistic? no i'm not as negative as i was when i came into this thing hating things. i'm not as negative, how about that >> we have a press briefing at 6:00 >> i'm trying to move that because of "mad money.

>> in beijing, hi. >> hey, guys, china's upper echelon of the communist party confirmed a meeting today and according to state tv they confirmed the economic recovery is accelerating. 14 provinces in china have now downgraded their emergency response level, this as new infections and deaths continue to decline in china. different case in south korea, they now have the most number of cases confirmed outside of china. that includes one u.s. soldier as well as the authorities's attempts to try to determine how many more they might have by testing 200,000 or so members of a church that's at the center of that country's outbreak. china and the authorities here have said that they're stepping up their efforts to screen travelers from south korea

one city here has said it's offering free test kits from visitors to that city. the chinese government is trying to access the economic damage. a sports official said the province where a lot of the venues are for the beijing winter olympics to be held in 2022, saw a drop by a third in visitors to their sports venues as well as ski resorts, the cornerna virus way on the minds of many sports officials in japan. the prime minister weighed in, calling for cultural sites and sports venues to push things off a bit for another two weeks as concerns mount about the potential cancellation of the tokyo olympics this summer here in beijing, we had another mixed message as to exactly how much of the coronavirus has been

detained here. the capital has now declared all supermarkets in this city have to screen and space out the customers that come into the super markets by two square meters other 4 to 5 square feet. that's, they said, to make sure there isn't a lot of crowding and because they're concerned about the potential spread of this virus >> howard, are people on the subway then -- if they don't want you to be within 4 to 5 feet of anybody, what about things like mass transit >> mass transit, people are in close quarters, but after the supermarkets they have been getting more crowded for the most part people don't like to go shopping and the grocery store is where they buy basic necessities. one pattern you're starting to see as more people come in the

capital, there are more people at the grocery store and more lines and concerning them and why they made that edict today >> passenger traffic day on day is up three-three versus two-six, the prior day people are moving around more. >> i like to say what a great job she's doing and morgan stanley, going back to work. i know if they're putting people back to work, it's supposed to put people very much at risk it doesn't sound like they're that much at risk, if you believe the numbers outside of wuhan, particularly we have more instances in this country. 50 million people have gotten the flu in this country. it seems like we're in a moment now where it's easier to get the flu here than the corneronavirus

there. >> the communist authorities we met today said they have to remain vigilant especially wuhan and hubei province, the most affected and policy officials are trying to do their best to try to stop the virus from spreading any further but at the same time supporting the economy the question, i think, can you really marry these two priorities i think it's increasingly unlikely the authorities are going to definitely get this calculation right. >> that's a tough balance, well said, eunice well said as always. talk to you in a bit change in business, iger steps down as ceo succeeded by bob chapek, who recently served as head of parks and products.

he talked about passing the torch with julia boorstin yesterday. >> as we looked at the businesses, we have a great set of assets and strategies, what's next in terms of my own priorities was making sure the pipeline in the company was rich and all our engines were working extremely well i wanted to spend more and more of my time on that the only way i was able to do that was give up the day-to-day running of the company and pass the torch on to bob. >> interesting succession calculus >> and a surprise. that's what took so many people by surprise was the immediacy of it as you might imagine, over late yesterday, into the night, texts, e-mails, phone calls, so many people in the media business including a lot of executives and other companies asking the question, is there

something else here? strange. i don't understand 22 months he will be executive chairman, why rush it? is there a health issue? i can tell you firstoff, no, there's not one health issue is this mr. iger's plan. i asked him about issues so many people want to raise wondering about the health of the business and so many other things iger said, listen, around thanksgiving of last year the desire to leave the company coalesced. he didn't want to be ceo anymore and raised it with the board around thanksgiving. the board had already identified certain candidates, already were in a mode of, as you might imagine, given a transition, still a ways away, but they certainly were getting ready for it regardless and they targeted people including the gentleman who got the job.

they moved from there to make the decision on this 22 month, which is long, in fact longer than anyone you can remember in terms of someone who was ceo moving into the executive chair seat, iger said, there's no rule book on this stuff. i've always done things differently. not an iconic class but has done things differently in his approach i would say that as well that is the story. 81 earnings calls, 20 years as either ceo or coo. he told me basically, i don't want to run the company anymore. i want to focus on the creative. does that mean he's going to be reading scripts and writing, he's always overseeing those, what it does mean is he will be taking a much more hands-on and solely focused approach to the direct to consumer international

business and how you fuel content for that he will be looking at things like hulu now disney fully controls and how you build that business out the fox studio not that far away when they made the deal never been an issue for iger, he paid big money that's a big number. fox studio, big changes there. wants to evolve in the geo brand. there's much for a creative business overall in the company. >> what a great call i've been racking my brain, maybe he wants to enjoy the rest of his life a bit, but maybe that's what the rest of his life would be enjoyable those calls are a drag >> you know what you have to have for a call. >> he's not really that happy.

i feel, a lot of times on the call he never belittles, a lot of times he feels like, guys, are you kidding me, do i have to keep answering espn? will you please think bigger i want people to read his book the book is great. >> it's written -- >> he wasn't expecting to be ceo now. he extended obviously based on the completion of the fox acquisition. it is a long period of time that he really be there they feel confident obviously. we will see. it will be interesting to watch. there's no alternative here. he's not going to run for office >> i think at one time, if it weren't for fox and murdoch -- >> he wants to, i think, a, they're very good at surprising

people there they do keep these things quiet. there are questions, kevin mayer's future at the company. they have every expectation he will stay, only a year building disney plus. and the executive that did not get the top job, i don't know what his plans are, mr. mayer, and certainly they expect he will stay and hopefully he does. that's where things stand and it was sudden and immediate no leaks the board kept it quiet since thanksgiving when mr. iger came to them and said, i really think it's time to step down >> he obviously didn't know about the coronavirus since then the theme park percentages are down they may have to close some theme parks. i talk about the fabled buying opportunity, i like this

i like this one. i just think it's good he's not leaving >> even with the short term park disruption >> i think everybody says, all the parks will close and nobody will do and it goes back to before disney plus >> you have an annual meeting not that far away, iger will be on there and then he will leave the stage. >> yesterday, i had an unfortunate choice of words. in the book, there was an unfortunate choice of words. it involved you. >> oh, yeah. there was no cursing in that there wasn't. >> did you hear cooperman on "squawk" >> wow, i think he took his cue from me. i apologized >> your kinds of words >> that david was doing a dogged amount of work and used the word crap >> he said holy crap

>> it goes to 116 where we didn't know about this you kidding me bob iger he's not going on vacation or south sea islands that i know of >> bob iger will stand up as one of the unique ceos >> i don't agree with you he is iconic class but mr. iconic class. >> so many guys are guessing, and ladies, guessing he never seemed to be guessing, always had a focused idea what he wanted to accomplish. >> exactly >> we will get the mad dash to opening bell and lowe's and wendy's and virgin galactic. and the first american case of the coronavirus. futures back in a moment ts to h. and you should be mad your smart fridge is unnecessarily complicated.

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salesforce is a story, of course we talked about executive succession a moment ago regarding disney jim did talk about that. >> i am so grateful to keith you and i know keith and i are

such great friends keith is ready to move on to his next chapter and will be staying on as an advisor to me i have to support him. he is ready to go forward and i give him my full blessing. >> that was marc benoff. i was talking about keith block. you know this company very well and mr. beniof >> and other than iger ascending to executive chairman role >> first, keith and marc remain good friends second, this was step-down tuesday, if you read another great book, keith and marc paired up for the big picture, kind of what you're talking about with bob iger. let's talk about, what a blowout quarter nobody seems to care

about at all talking about $35 billion in revs, just the rpo, the performance numbers we look at as billings wow. >> very strong >> what about the fact a guy ceo only lasted 18 months. >> he wants to do his own thing. does he go to oracle i don't know, if he's advising mark, even though larry ellison and marc remain friends that would be odd i don't think keith wants to compete directly i think keith would be shocked this stock is down they won big orders including volkswagen, gigantic i thought marc loved the time off with his family and time to do some things trillion tree initiative >> what did he find it's not as much fun as he thought and wants

to run the company full-time without any help >> yes he was so happy yesterday. so was keith he was pretty happy. can i go back to funds it's like talking about the doctors, like i know anything about the coronavirus. the business is great. he said it's not like the coronavirus is cutting off our business it's not like the china situation. if it's going to be down, that's a great quarter. the market looks good today. hate to buy it off i am not fretting keith's leaving as much as i love keith. keith is very different from marc i thought marc enjoyed that time with his family, lynn and the two girls, which he still does marc also loved all the initiatives, "time" magazine,

$300 million for homeless, trying to help the darned world. i think he can do both he will be ceo very shortly. he's too good not to be. he's the closer. i always call him the closer >> he closed it out pretty quick over there >> is there any kind of -- what do you like? you're like henne young? >> i am. >> i'm trying to be straight and he's taking the little things i have he's gotten a lot of pep lately. what's that about? >> he's rochester to your jack benny. >> yes i'm dickens. you're fenster go google that >> small staff >> kiss me, keith. >> there is some research we didn't get to. hsb does cut nike to hold. i know you've seen this one.

>> i've been waiting for that call >> surprise shares trading 2% blonde the all time highs. it will be in march and doubt it will be supportive >> china slow and now talking about europe slowing, i do think he will do a great job this will be the correct one when you get maybe in the 80s, you can say, you know what, this thing will run its course. eunice did say -- did not portray a world where china was as bad as it was three weeks ago. she's been spot on >> lucky to have her >> we're coming off the worst two-day point loss for the dow here's a look how futures traded in the last 12 hours you saw that big dip around 3:30 a.m. eastern time where we did crack 3100 people talk about 330 being the support on the 200 day

>> we saw the bonds take a big drop i was watching at 3:30 because i'm obviously completely insane. i did feel, oh, no, here we go again. we have some going higher and we have all great tjx doing this you have stocks reacting to earnings at this time during this era >> there's the bell. it looks good. pencils, promise, building schools and creational programs around the world at the nasdaq, exact sciences of screening and diagnostic tests guides below for a year. is this a matter of just being cautious >> tjx is an all time high why is that? everyone has too much inventory and too much cash to buy that inventory.

they offer tremendous bargains they're either offline or -- you have to go and the line is always long or online and offering a terrific bargain. tjx, they cleaned up this is the beginning. they have so much inventory from all retailers doing terribly it ends up in tjx's hands. i like this company. marvin ellison, how about he got room on the margins and so much room to make the dotcom better. >> marvin ellison. >> i love him. i like the margins, very strong. home depot had a good number and stock up strong. corona, corona and then getting much more leverage out of people conscious

of the toll. we have doug yearly on tonight toll should have done better on interest rates let's talk about that. >> let's talk about growth once again outpacing value nasdaq up 8% >> a lot of fang there >> apple part of that and amazon's big resurgence after disappointment, under-performling. then you had a lot of people get out of that trade and go into value, the likes of the banks andenergy. lower rates for banks, we know what's been happening. >> that seems a very ill-advised move, david. >> and macro concerns. >> if you can't care about how you're doing, you care about performance and you care about doing well, that was obviously ill-advised. >> you are. >> if you don't care, so rich

like warren buffet, it could be brilliant. like dole. and if you are a multi-billionaire, that's not right. i think fang offers a better opportunity because the compression of the multiples are extraordinary. netflix is doing terrific. why? overseas and alphabet too low and cloud services doing much better alphabet, okay, people coming back to work amazon, i understand, is doing quite well am i supposed to hate that group? instagram on fire. i don't know, i like f.a.a.n.g >> do you want to buy -- >> tesla shares up only 88% for the year down dramaly from highs. up only 8% for the year. >> the 19th month of decline,

toyota today warned on corona, not because of china, they will face bottlenecks >> ford, do i worry about the dividend, perhaps? i thought home depot would have bought them today after lowe's, not. not a great day to buy the market when it's up. you may get chances. >> the first cluster of cases, whatever it is in the united states we have 30 cases in. >> the first shoe is a tourist from spain who went on -- a tourist from italy, went to the airport, very easy, from milan, came to jfk. that person, that's a great patient one. >> the patient one -- >> we think patient one. we don't have any tests or kids. that market goes down. that's why you put a little bit

to work. not a lot. if the market is up, no. i'm talking about the value trade and oil trade. the curve says 51-7. >> you're not a value over growth >> it's a special situation, a special situation, especially bad! and by the way with natural gas here a buck and change, they can't even drill because you have so much natural gas you can't do anything with >> exxon lost 22% of its value here >> i don't want to touch exson i don't want to touch exxon. >> really? >> meanwhile, we've been talking about maderna a few days here. meg has everything you need to know >> the first was about the coronavirus. and they made the first

shipment it was unquestionably a record for vaccine development timelines, 42 days after identifying the key target for the vaccine and maderna's involvement in the trials and scale of manufacturing and financial improvements for the company and the overall response to management, too soon to say the first phase may start in a month and a half and then take three to four months to determine safety and whether it provides an immune response. the next phase is hundreds or thousands of people in an area with active transmission realistically, at least a year before vaccine is ready for broad deployment if trials are successful at that point manufacturing at capacity is adee question. moderna is doing as much as it can but a bigger manufacturing partner is needed tore millions

of doses and telling analysts the only focus when it comes to the coronavirus is the public's health >> let me ask you something. you talk to them over at regeneron. they solved ebola. don't you get a sense they've gotten optimistic in terms of the medical community and what they can do? >> yes they are doing the exact same thing they used for ebola that was tested in the field and showed for clinical trial and outcomes for ebola they are not paying much attention to that. they are trying to work incredibly quickly we should look for them for a potential new drug and it takes months and why they're looking at gilead because the

experimental drug already exists >> what are you hearing about the malaria dwrrug as a possibility? >> that was an old drug and there was pre-clinical work it may have against the virus they were saying earlier this week that drug is the only thing that looks like it has promise and suggesting that be prioritized in clinical trials they're not saying it doesn't work but not emphasizing it. >> the possibility dr. falce, i think is terrific, a longer term solution, we have checks and balances here. we don't like to make people sick who are healthy i don't believe the chinese have a similar level of care with hospitals handling 500,000 people and you have a lot of tests there absolutely you're giving false positives i'm not saying it's not dire, i

am saying, and do think maybe dr. falce's view is certainly correct in america and perhaps the chinese should be a little more aggressive. >> you mean in terms of testing drugs on patients? >> you bet >> it's possible here in the united states what dr. falce is saying, the phase two, rolled out among people who could be infected for the fact see seen, -- the vaccine, it's to prevent infection. they're not infecting people to test the drug. >> thank you meg on top of that dow is up 250. disney is the only componeis ma down they -- i obviously have

huge shoes to fill my job is to take the strategic pillar he has so well established over the last 15 years and continue to implement those in the marketplace, mostly direct to consumer and look for what disruption is going on in the marketplaces would necessitate a fresh look at those things right now, bob's lead is one we intend to follow >> if the choice was on operations guy, executive versus deals executive, they went with ops. >> virtually every part of the company, although not direct to consumer, such an opponent component of the growth or strategy of the company, that will be overseen by kevin mayer, at least for now and that is a kequestion one would think as he

was a top candidate for the guy. he's almost 60 years old if you're going to get to the guy as ceo, according to the journal, you will get to him, get it done, talking to mr. iger this morning, made it clear to me he didn't want to be ceo anymore. 20 years at the top of the company. 15 ceo for five, 81 earnings calls, i guess he was counting them all and will focus on what is the most important initiative still for the company while mr. chapek has the opportunity to -- transition is not the right word because he's the boss right now and everybody is reporting to him. he is only reporting to one guy now that being iger, to get his feet deeper in many other areas while iger focuses on direct consumer internationally and growing that business, growing hulu and fox studio and things that come under the content

area >> isn't it interesting. you know jaime dimon and bob iger say, the heck with it, i'm getting another job. the fact he was 60, in a year or two, he would not be it. typically in another year or two a 60-year-old man or woman would not be it. >> you talk about the window ascending that ceo job, talking usually early to mid-50s that's the runway. these days they don't stay in those jobs that long >> most people turn 65, david, they're done >> done. sorry, not you you're not a ceo you're different >> i'm a person. >> your unique well, we're not sureabout that >> i'm a dollar sign represented by a man >> you made the point on twitter earlier this morning, the thing to watch is yields >> yes

>> that they bounced >> they're everything. >> germany is suspending their debt break and some other. >> that was very important i wish it weren't so simple as lee cooperman talked about the algorithms every time interest rates do down the machines sell if you're buy hearing, you have to recognize you are betting the interest rates will stay inflated a little bit today. if they slip, in other words, if interest rates go down, everything you bought today you will lose money. it's a little too -- everything. >> technicians are still looking at 1 and a quarter depends who you talk to obviously. >> i think they could be right up here, you're making a substantial bet you have seen the end of the decline in rates. i don't think that's the case. >> up here >> up here >> 1, 3, 7, nosebleed territory. >> i don't like to buy at 350

dow. i don't like that. i don't like it! >> we will say lower than it's ever been. >> did you change your mind? >> i think that's more likely than not given what we're hearing from the cdc rates could go lower >> the president has a speech today at 6:00. we know the president is bullish, shocker bullish. >> fair to say the s&p hasn't been down 3% for three consecutive days since the depression >> what! >> 1931. >> my god, that didn't work out so well right then that was early you were early buying that day >> let's get to bob pisani hi >> boeing, 3m, microsoft, even jpmorgan and the banks are

contributing china shares doing well for a second day in a row trying to indicate they're attempting to get back to normal banks having a good morning. semis and industrials, and low energy even though on the to temporary in terms of gains up fractionally where's the bottom we had two unusual days. two 90% downside days. that doesn't happen often and often indicative of short term bottom splip a supply and demand. selling exhausting and trends improving. >> seeing the futures market we look at very carefully, this is the european open, a 500 point equivalent drop in the dow, 50 points in s&p futures. as europe opened there were speculations about bigger

outbreaks in france and europe and we have rolling outbreaks that affect the market upon that makes a lot of people think this is not necessarily over. in terms of what's affected, pretty modest. banks off their highs. a little more than 10% or banks off their highs. a few in correction territory, not that dramatic. you look at the f.a.a.n.g. names, down in modest correction territory. a little odd apple has significant exposure to china look around. facebook and google, what exposure do they have to china, not much at all, they're down to the same level it's not really rational what's exposed to the markets the exchanges are loving all this volatility. c.&b futuring record volatility.

record since october 2018. and 50% heavier volume than usual. all the exchanges love this volatility and one of the big market makers out there has had a nice run since this happened. there are people with benefits we will see fiscal stimulus on an epic level. we are already seeing signs of it there's reports this morning germany will temporarily suspend the limits on public borrowing reports hong kong will do a massive spending program, hong kong, $10,000 of hong kong money given to every citizen, $1200 in cash here. central banks and governments will be engaging in massive rounds of giving away money to help

back to you. >> thank you, bob pisani rick is in chicago hey, rick. >> good morning. this tells us a lot of information and i will be telling you more 135 plus is a very significant close. many of yesterday's settlement for tens around 132, like the "wall street journal." they tend to mark the close the same time stocks close that really isn't the close in my opinion, when the cash market closes, around 1:35 plus june 16, based on my interpretation, how important closes are, we are still hovering anddidn't violate tha 135 plus june 16 nonetheless, you have to pay close attention to, been on intraday trade look at this everybody's been talking about in the wee hours of the morning,

we had a market reversal and electronic futures and the same is true with the german finance minister suspending the debt break. pretty big move. steeping five basis points, its 120 yields are down a bit and 12710 year note yields up 124. you have a much weaker short end and stronger long end. let's look at the dollar index, up 14 days, right itself it is up a bit it is close to 3997, a september high in 2017 back to you. >> we will see you in a bit. still to dom this mornicome thiw talk to dr. fauci from nih

dow up 300, currently up 280, back after a short break

after four very rough days s&p is up almost 30 points and the dow is up 242 with most of the components in the green with the exception really of disney we'll get stock trading with jim after a break. remember you can always watch us live on the go on the cnbc app

we see access to fresh food being the global norm, not the exception. at emerson, when issues become inspiration, creating a better world isn't just a result, it's a responsibility. emerson. consider it solved.

time for jim and stock trading. >> wall street never can stop us they came public not that long ago. an absolutely horrible quarter thanks for nothing stc. still stay away. nothing there. that is not the kind of blue chip you want to reach during a coronavirus epidemic david? >> i'll make sure to put that down thank you. >> okay. that is not the blue chip you're looking for. i do have, hopefully you can do the show i have hp. that's right hp enrique lores.

sorry. i thought you should have had that one >> i thought i was maybe he'll come on with me sometime but doesn't appear likely >> i have a superior set of skills to people like you. >> i've just given up. you can have them all. >> all right jim, we hope to see you tonight at 6:00. eastern time dow is up 275. we're back in a moment

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welcome back to "squawk on the street." rick santelli live on the floor of the cme group awaiting gnaw home sales for the month of january. do remember in june of last year we had 729,000 that was the best in 12 years. just as a benchmark 764,000 seasonally adjusted annualized units. that is way better much better than the expected number around 720,000 and that also is accompanied by a nice revision that pops a handle from 694,000 over the 4700,000 mark almost an 8% jump with regard to 708,000 to 764,000 and 764,000 just by coincidence

of course usurps the 729,000 so we have to go in the way back machine now. that takes us all the way to the best numbers since july of 2007, again, because that number is so high, 778,000. now, to really get a handle on this let's aim east and go to diana olick. diana, what a whopper number >> reporter: yeah, rick. this is a gorgeous beat at 764,000. the expectation was 711,000. then you also had the nice revision to december's numbers now, the big surge that i'm sooepg is seeing the midwest and the west. midwest might have had to do with the weather the median price is up pretty significantly from a year ago at $305,400 we were hoping to see the prices come back a little bit builders getting nah the more entry level product. if they're selling at that price then they're selling at that price. we saw the surges in the midwest and west likely due to weather

we do see a 5.1-month supply, a bit lower than we saw last month so we want to see builders ramping up production. we saw housing starts really spike nicely in december pulled back a little bit i'm talking single family. pulled back a little bit in january. so we want to see the builders continue to wr continue to ramp up production because the biggest problem in the existing home market is an extreme shortage of homes for sale builders have to make up for that a beautiful beat, carl >> thank you diana and rick, good wednesday morning everybody. welcome back to "squawk on the street." i'm carl quintanilla with sara eisen and david faber live at post 9 of the new york stock exchange obviously a rebound today settling in although off of the highs we were up 300 plus. currently up 196 you're watching yields back to 136 and oil is still fighting for 50 >> our road map for the hour starts with that stock bounceback markets looking to hold on to gains as the s&p comes off its worst two-day slide in four and a half years >> plus the race for a cure as the cdc warns of coronavirus

spreading in this country. we'll talk to the man heading up our country's potential vaccine deployment strategy later this hour >> and disney's long-time ceo and successful ceo bob eiger is leaving his post he has assumed the role of executive chairman we'll tell you why the change happened now and what to expect from his successor >> we'll begin with the latest on the coronavirus with fears sending the s&p to its worst two day slide in more than four years this as the president tweets out that he will address the virus in a news conference tonight at 6:00 p.m. eastern. we'll go to the white house for the very latest on the administration's efforts >> reporter: administration officials are not saying exactly what the president plans to say in the briefing at 6:00 p.m. he just returned early this morning from that trip to india so a lot of the top staffers have been traveling with him overseas the president though not shy about taking to twitter to place blame here and talk about markets in terms of his focus on

coronavirus. here is the president's tweet a short time ago blaming the media, he says low ratings and fake news msdnc parenthesis comcast and cnn are doing everything possible to make the coronavirus look as bad as possible including panicking markets if possible. like wise, their incompetent do nothing democrat comrades are all talk no action u.s.a. in great shape. cdc.gov. so the president here looking to place blame for the market slide on the media and placing some blame on democrats on capitol hill meanwhile, you've got this competing set of financing proposals here between capitol hill and the white house the president's request for funding for coronavirus was $2.5 billion earlier this week senator chuck schumer in the senate is proposing $8.5 billion this morning i talked to some white house officials about that today they say the president's request at $2.5 billion was entirely appropriate and will fund an all of government response they are not expected to match

that request of $8.5 billion clearly, it'll be up to congress because congress controls the purse strings here you imagine the president will sign any funding request that makes its way back over to him back to you. >> eamon, i know he is blaming the media and the democrats and everyone else but it was the cdc yesterday that put out the dire warning that americans should prepare talking about everything from school closures to limiting business meetings. >> reporter: that's right, sara. i picked up on some frustration in the white house after that cdc briefing that the communications were not well coordinated. you had the cdc saying we'll have these closings, americans should brace for this because it potentially could happen and then you had larry kudlow and the president sending an entirely different tonal message saying this is well contained, we have it pretty much bottled up, nothing to worry about those two things were completely divergent and i think that caused some of the skittishness in marx in markets

the question is whether they can get the message on the same page today. white house officials this morning say, look. what we're talking about is where this is right now. it is contained right now. what the cdc is talking about is what could potentially happen in the future that's just a possibility and a potential worst case scenario. we are doing everything we can now to make sure we don't get to the worst case scenario down the road, sara >> thank you for that. we'll see what the president says later on tonight. for more on the massive swings in the market, let's bring in our guest. good to have you back. good morning >> good morning. >> we've been hearing a lot about support levels not far from where we are right now. is that where your head is at the moment >> i am never thinking about where a support level is or a resistance level at oakmark we are much more focused on long term value of companies and looking for prices that are well below those long term values. and to us, some of the moves we've seen in the past couple

days, a continuation of value under performing for the past couple of years. creates a very attractive environment for investing. more than half our portfolio today is at a pe multiple on next year's earnings under 12, about one-third is single digit pe it is nothing like the extended part of the market that we hear so much about. >> right so then talk to us about where you see valuations right now i mean, the drop has been dramatic over the last couple days but i imagine you would argue it looks dramatic because we're unwinding what was a real chase that was on prior to the onset. >> well, i wish it was just the stocks that were on the chase that were getting unwound. it seems to be unwinding everything, whether it has been part of the move up or not but where we see value today, i would say starts with the financials a company like ally selling at just over six times earnings

capital one, citigroup at eight times. bank america ten times we think the whole group is pretty attractive. the large players are developing stronger competitive advantages and the relative multiple compared to the s&p is about as low as it's ever been compared to other areas of the market that tend to be lower risk like utilities, the relative multiple is at historic lows. we think they are very attractive >> on the banks, bill, can you really get the banks up without the ten-year yield going up? now 136 on the ten year. we've seen this inversion on and off. it seems like that group in particular is really beholden to what the curve is doing. >> i know there are traders that certainly look at the data that you're quoting but what we look at is consensus earnings for this year, which don't include a move in interest rates. put these companies at single digit multiples. they're generating tremendous

excess cash. a lot of them will be buying back almost 10% of their share base at current prices to us, that makes them very, very attractive. >> bill, notthe first time i'v asked you this or we've discussed it but it is not easy out there being a value investor and hasn't been for a long time. it did seem as though the growth versus value trade was starting to break a little in favor of value recently only to have coronavirus fears sort of scuttle that a bit give me your overall thoughts here why you stick with this strategy >> well, we stick with this strategy, david, because it is what we've used since oakmark was started in 1991. if you look at the very long term, since we launched oakmark the s&p is up about 12 fold. we've doubled that in oakmark by using a long-term patient approach to investing. during our time of running oakmark there have been a bunch of concerns about new viruses that we didn't know exactly the

path they would take to us, coronavirus doesn't look a lot different. if your business is trying to predict next quarter's earnings or 2020 earnings, i can see why you're focused on corona but my job for 20 some years has been to communicate to our share holders that whatever you are hearing in the news you're probably over reacting to and you shouldn't be letting it influence your investment approach i think it's highly unlikely that a year or two from now we're still talking about coronavirus and when you take a seven-year approach to valuing a company like we do at oakmark, it just becomes a pretty minor event even though it does move the market around. >> that said, bill, i wonder, speaking of clients, you know, going back to early january let's say when we were seeing names go parabolic, were you hearing from them asking why are we missing out on certain sectors that are moving faster

i wonder, did that kind of commentary even though it might be minimal, did it hit any kind of fever pitch >> we always hear that from our individual clients they're always looking at what has gone up that we don't own and wishing they had owned it. it happened back in 1999 when people were telling us they would sell their fund investments if we didn't start buying some technology and internet stocks. part of our job is to tell people that if you're a long term investor, you can't just look in the rear view mirror and think you'll catch up by buying tesla because it's tripled this year >> finally, bill, just back to financials because i do notice whether it is the oakmark fund, the select fund, or the global select fund, financials broadly speaking have a pretty significant weighting. you are obviously not concerned or don't believe there is going to be a recession any time soon, i guess. >> i don't think i have any better opinion on whether there is a recession soon than anyone

else does. we don't see a lot of signs of our companies, you know, behaving like it's an over extended economy but i think it is really important to the financial story to see how much stronger their balance sheets are investors tend to have a recency bias and worry too much about how they behave in the last recession but that is certainly not a typical recession. the banks generally have about twice the capital relative to dollars of assets today as they had ten years ago. and the underwriting standards on the loans are higher than they were. so even if there is a recession, this is a group we're comfortable owning >> that's what makes investing so challenging thanks as always see you soon >> thanks for having me. many investors want to know if production is picking up in china and if the coronavirus outbreak that the country is facing is starting to actually plateau. our steve liesman is back at hq with more.

steve, what data are you looking at >> first of all, there is the top line data out there which does show growth of the virus in china is plateauing or at least appears to be. it continues to spread in other countries. inside china economists are looking at alternative data showing that the country is not getting back to work as quickly as hoped for example, traffic congestion in beijing running 20% to 60% below 2019 averages. less congestion is a sign that economic activity is running below normal similarly, coal consumption not even close to where it usually is a very big deal in a country that gets 60% of its power from coal you can see how far that is below normal there all of this leaning against the hopes that china would get back to work by the end of this month. jpmorgan this morning slashing its growth forecast for the first quarter in china and now looks for the economy to contract 4%. that compares with the previous forecast of 1% growth. it sees a stronger bounce back now in the second quarter of 15% compared to a 9% rebound

writing in a commentary jpmorgan says the pace of factory reopening has been slower than anticipated. the fundamental issue is the policy dma between virus control and normalization of economic activity. a prolonged slump of course could mean the knockdown effect to the u.s. could be worse at least in the first quarter so far fed officials have not changed their stance on waiting for more evidence of a u.s. effect before committing to rate cuts not the view of the market they have a 59% chance of an april cut, 53% chance of a second cut in july and toying with a third cut for december. a second quarter bounceback in china would validate the fed's stance but the chinese data so far have yet to back up the forecasts the country is coming back to work, sara >> all right steve, thank you when we return, it's not if but when, the cdc warning americans about the possible spread of coronavirus in the united states. we will talk to the head of infectious diseases at the nih

dr. anthony fauci. checking where we stand in the markets off the highs of the morning, still the bounce is intact, up 289 on the dow led by boeing and 3m. s&p up a percent

welcome back a little after 4:00 p.m. yesterday when the markets got somewhat shocking news disney's long-time ceo of 15 years plus bob eiger who is of course overseeing so much change at the huge media company

stepping down immediately as the company ceo. handing the reins over to the new ceo, stepping up to an executive chairman role he'll hold for the next 22 months in which he will be much more focused on the creative pipeline of the company you can see disney shares not reacting too badly to the news it was certainly a surprise. none of it had leaked of course in any way and mr. eiger has a history of kind of sort of surprising people. he kind of enjoys doing that plenty of questions i was certainly getting over the course of the evening as well from many in the media business wondering why the timing, why the immediacy, why the long, 22 months i did talk to mr. iger this morning and asked him to explain some of the decision making. he had done that on a conference call yesterday and with julia boorstin but he did tell me it was really thanksgiving he

started to think about stepping down the idea coalesced for him no longer being the ceo he said to me i don't want to be ceo anymore of this company citing 20 years in the top job or as coo 81 different conference calls about earnings and the time that's gone by. his desire to focus more narrowly and significantly on the creative business at the company and the pipeline therein whether that is hulu, a company that is completely not controlled by disney whether it's the post avengers world where so many of these incredibly successful sequels and story lines have ended whether it is the fox studio of course the huge acquisition for the company not long ago where there are continued changes or even evolving the nat geo brand. mr. iger making it clear he came at thanksgiving to the board the board had already been thinking about it and pursued it more aggressively and with no leaks many of us were obviously

deeply surprised something mr. iger says he kind of likes to do and has done many times usually with an enormous and important deals. as for the transition or the 22 months he said, listen there is no rule on these things we do what we think is right and best for disney. in this case the 22 months, the focus on so much that is still changing at the company for him will be the key in terms of developing the direct to consumer business for example in international markets and so many of the others that i mentioned. but chapek is now the ceo running things day to day. he has only one person he reports to mr. iger julia boorstin did speak with both yesterday after the news first broke. she is with us now for a look at what is in store for disney's new leader day one on the job. >> that's right. 27-year disney veteran bob

chapek has big shoes to fill and also big challenges when it comes to the cord cutting trend in disney's shift more toward director consumer streaming and away from the tv bundle. chapek doesn't have experience in streaming and hasn't been involved with disney plus. but he told me his time running the various divisions will help him. >> i have worked in consumer businesses my entire career and it's not ironic that our strategy for the media business now is director consumer business that is my sweet spot and i think something that i could leverage now throughout all my experiences not only at disney but even before. >> reporter: the area where chapek has the most experience, disney parks, is under perhaps the most pressure. the disney shanghai and hong kong parks are both closed due to coronavirus and there are questions about how the virus will impact its cruise ship

fleet among other things >> the long term health of our business is really a function of our consumer demand for unbelievable story telling and our product. while this is certainly a bump in the road in terms of the coronavirus, we'll come through this like we've come through every other challenge we've had and that affinity for the brand and our story telling will way out last any type of short term blip we have from coronavirus. >> now chapek tells me he wants to continue to build on iger's legacy while also keeping an eye on different elements of disruption and where there might be a necessity to make more dramatic changes you can find my entire interview with bob chapek and bob iger on cnbc.com back over to you >> julia, no shortage of various things as you point out, things he knows very well and has to familiarize himself with iger also no stranger to reading scripts and green lighting films

and series, is he? he is certainly going to be focused on the bigger picture there but has been doing that for a long time. anybody who read his book would certainly know that. >> reporter: in terms of what bob iger is going to focus on? absolutely as executive chairman through the end of 2021, it sounds like from everything iger has said he really sees an opportunity to oversee the contents side of the business look, iger is going to be looking at disin i plus and the build out of content there as well as the studio, which needs to find its next chapter after the end of the avengers franchise as well as figuring out the role that the fox studio plays in the future of walt disney studios and then of course when it comes to the tv landscape looking at what the rest of the, sort of the next chapter for the tv bundle looks like and where disney's content fits in there. what iger has really done so remarkably is figured out how to build up the brands and really exploit them across all of disney's platforms and one thing that is very clear is that iger

understands the importance of the content, the importance of the brands at the center of everything disney does and now by focusing just on that content he is really going to be working on the growth engine of everything that will -- that chapek will have to work on after his departure. >> david, as far as that surprise timing i was having a little dejavu when the news hit yesterday on "closing bell" because if you remember,just a few months ago nike did a very similar thing. it announced sort of randomly in terms of timing and earlier than the market expected mark parker would step down, john donahoe would become ceo mark parker took on the executive chairman role which is sort of a new trendy thing i think. interestingly parker is on the board of disney. this whole sort of coming at a position of strength and whether there is more to read into that or not if anything was going on behind the scenes but nike kept telling me, no, there is nothing. nothing behind this. no scandals behind this. we just -- parker wanted to make change and he had the guy and it

was time >> to your point it raises a lot of questions and again my understanding is and having spoken with bob this morning as well, there is nothing else behind it other than he no longer wanted to be ceo. obviously you might imagine the board, well he has a contract to stay at the company as it was until the end of 2021. it is not a health issue or anything else like that. just simply time for him, he felt like, to go not to mention, you know, chapek is not a youngster so is sort of in the key part of his career in terms of when you would ascend to that role >> all right disney shares off now less than a percent. julia, thank you time for our etf spotlight looking at spdr biotech ticker xpi recouping losses from the two day sell-off and shares of moderna continuing to surge as news of its coronavirus vaccine shipment overshadows weaker quarterly revenue, up 19% today. yesterday anthony fauci the doctor at the nih we'll have talk to you in a few mints said

he is optimistic we could see this vaccine after a few trials come about a year to a year and a half which he says is very fast in the meantime over to the santelli exchange at the cme hey, rick. >> good morning, carl. so much going on we all know the given. coronavirus and other factors have given us a big month of february look at ten-year note yields how far they have dropped. look at the s&p 500 cash market. look at how much it's dropped just in the last six sessions. obviously viewers, you know that why am i bringing it up? because we're coming to an end of the month granted, end of the month rebalancing aren't as big as end of quarters but they still are big. and the easiest way to think about it is reversing recent moves. so if you have dropped a lot in yields and the market has rallied look for selling and treasuries to rebalance the moves of the month and the s&p 500 of course moved

much lower look for that rebalancing to move a bit higher based on buying then it gets mixed up between real players, portfolio players, indexers, and speculators, and large traders. they have t plus 2 in terms of settlement and ownership for friday that would mean today's trade. but the indexes of course are bench marked on friday's close finally when it comes to trading big ranges everybody is looking at the july 16, 2016 bottom right above 135. but the issue is, the other part of the double bottom from 2012 was like three basis points higher right around 138. the point is, even if you violate current 135 july bottoms from 16 you have to give it some fudge factors. the important issue is traders don't like triple bottoms. they like double bottoms look for consolidation this may be a temporary bottom but traders don't think it will be the bottom. david, back to you >> okay.

thank you, rick. after the break finding a cure for the coronavirus we'll speak with the head of infectious diseases at the nih, dr. anthony fauci, of course "squawk on the street" returns in two minutes ( ♪ ) through the at&t network, edge-to-edge intelligence gives you the power to see every corner of your growing business. from managing inventory...

to detecting and preventing threats... to scaling up your production. giving you a nice big edge over your competition. that's the power of edge-to-edge intelligence.

welcome back everybody i'm sue herera here is your cnbc news update at this hour. president trump and the first lady returning from india early this morning president tweeting that he will hold a white house news conference on the coronavirus outbreak at 6:00 p.m. eastern time tonight accompanied by representatives of the cdc take a look at that picture. that is a major refinery and a

major freeway in california had to be shut down after a fire broke out at that refinery it is the largest on the west coast and is very close to the freeway. officials shut down the 405 in both directions as the los angeles county fire department responded to the blaze so far no injuries have been reported a bus carrying members of a wedding party plunging into a river in western india killing at least 24 people police say the driver lost control of the bus after a tire burst. and maria sharapova saying she is retiring from tennis. the 32-year-old won five grand slam singles titles but struggled after returning from a suspension for using a banned substance. sharapova saying that she will miss professional tennis every day. you are up to date that's the news update this hour sara, back downtown to you >> sue, thank you. the president paying very close attention to market volatility this morning after the two day sell-off he has scheduled a news conference from the white house tonight. 6:00 p.m. eastern time to

address the coronavirus outbreak and joining us right now is a member, key member of the president trump virus task force, welcome back to the director of national institute of allergy and infectious diseases dr. anthony fauci good to see you. thank you for joining us >> good to be with you >> so, dr. fauci, you have been at nih since the mid 1980s, advised six presidents, been through sars and ebola where does this stack up, the coronavirus, in terms of the threat relative to some of those other outbreaks? >> well, those other outbreaks actually became real this is something that is still evolving it has obviously had a devastating impact in china. the impact on the rest of the world is still a work in progress we've seen over the last couple weeks that other countries like japan, korea, italy, iran are starting to have community based

transmissions where you have sustained transmission from person to person that becomes a big threat for the rest of the world because if in fact it evolves into a pandemic then every country including the united states is going to get impacted. >> is there any talk of closing flights from europe or flights from asia outside of china like what we did with china >> no. i don't think at all that will happen one thing when you have a pandemic that involves multiple countries travel restrictions become almost irrelevant because you can't keep out the entire world. when it was focused only on china we had a period of time temporary that we could do a travel restriction that prevented cases from coming into the united states. but when you have multiple countries involved it is very difficult to do that in fact, it is impossible. >> what is your sense of the level of cases right now in the

united states? is it possible there could be way more than what is officially counted and released because of testing procedures >> you know, that is possible but really remotely. we've done a very good job in containing the travel related cases that we've had we've had 12 plus two that were the spouses who got infected and we brought in over 30 individuals from the diamond princess cruise ship we don't appear to have any other secondary transmissions. certainly there's the possibility that there are some under the radar screen but i really think that is a remote possibility and not a real one >> dr. fauci what if anything can you tell us with confidence you've learned about the virus whether it is the death rate or transmission rates or vulnerable populations? what can you sort of tell us with some confidence so we can understand it better >> sure.

well, that is a good question. there are things we know with some confidence and things we know with a good deal of confidence what we know for the good deal of confidence is that this virus spreads very efficiently and rapidly among humans it is not one that has difficulty going from human to human. number two, overwhelmingly the people who get into serious trouble, who get desperately ill and sometimes die, are generally elderly individuals and individuals who have underlying disease -- heart disease, lung disease, diabetes, obesity, and things like that that we know for sure. >> doctor, i'd love to ask you about money. azar is in front of the house this morning and says the rapid response fund in his words is already committed or obligated the white house looking for 2.5. schumer is talking more 8.5. do you have a number that makes sense? >> well, you know, when the secretary was talking about the

2.5 billion, that was really a start. a down payment we need that now and hopefully will get it but i think in the future as we get into the next fiscal year, there certainly will be additional requirements. >> we've been watching the numbers every night out of china. they have trended lower. there's definitely an improvement there. what do you attribute that to? is it something that we could do here in the united states if the numbers start to pick up >> well the chinese have been extraordinary in the measures they've put into place they have shut down major cities, locked down 55 million people including the 11 million people in wuhan. a city in hubei province that is very draconian methods certainly we hope we never get to the point where we have the situation here that we've had in china. i doubt we would do that there would be other ways to

mitigate the chinese have been very dramatic in what they've done. >> how would you advise viewers to absorb and process the conflicting rhetoric between certainly larry kudlow on our air yesterday where he said we've contained this won't say air tight but pretty close to air tight versus the cdc versus the president this morning saying the u.s.a. is in great shape? >> well, you know, in many respects when you look carefully at those statements, they're not as contradictory as you might think. when you look at what's happening today, in the united states, the cases we have are well contained and well controlled i believe that's what larry was referring to that's what the president was referring to when you talk about what the cdc was saying and i agree with them, that even though it is well contained now what is going on in the rest of the world is making it look more and more like we will have something that

either is or approaches a pandemic and if we do, we need to be prepared as to what steps we'll take to mitigate that. and that's what the cdc was saying that if it happens we'll need to do this, this, and this. so in some respects there wasn't as much, you know, contradiction there as people thought. >> but it doesn't sound like you would have gone with the verb contained. >> well, i mean, contained for the present now but i feel clearly the way the cdc does that there are dangerous things going on out there in other countries. and that will have an impact on our country no matter what we do >> is there any evidence it spreads on surfaces? is that a way to contract it >> likely there is some spread that way viruses generally don't live very long for example on door knobs or screens there may be some i think minor component of that.

but that's not the major way it is spread. >> there also, dr. fauci, is a belief that come spring or warmer temperatures that the virus will die down if not die out. is that correct? >> well, we don't know if it will but the concept of viruses like influenza or even some of the coronaviruses are diminishing when the weather gets warm is not an unreasonable concept. because it happens every year with influenza and it happens with some of the coronaviruses the wild card here is that this is a brand new virus this novel coronavirus. we do not know whether it is going to diminish as the weather gets warm. we can't count on that >> understood. >> finally we've been telling people because i've been hearing don't shake hand eliminate that as a behavior some people laugh and say that isn't going to do much would that actually help take down the rate of transmission?

>> no, i think it would. the same thing as washing your hands. by not shaking hands is in many respects the same as washing your hands frequently so you don't have transmission back and forth. when you are in the middle of an outbreak of influenza or whatever, you should try as best as possible not to shake hands so much or if you do wash your hands frequently >> dr. fauci, you gave us some hope on a vaccine, which you say is moving rapidly through the testing, phase one trials. or at least going toward that direction. anything else you can tell us about how quickly that could happen and do you think the chinese could make something like that happen even more quickly >> no, i doubt if anyone could do it more quickly we'll go into a phase one trial in about a month and a half, two months which is the fastest anyone has ever done it but going into a phase one trial for safety doesn't mean that you have a vaccine that you could

deploy widely to ten, 20, 30, a hundred million people that is going to take at least a year to a year and a half to get to that point no matter how fast we go. >> you think that virus will still be with us at that point >> you know, it might. i don't think a vaccine is going to be applicable for what we're going through now over the next several months but if this cycles and comes back, next year, then having a vaccine a year, year from now will be very applicable >> dr. fauci, thank you for taking the time. >> good to be with you >> we appreciate the update from the nih. more than an hour into trading stocks hovering near session highs as we look to rebound from the massive two day sell-off our senior markets commentator mike santoli is on set try to put a grade on today's bounce >> it is acceptable. i would say bouncing when you should have. i mean, given the flush two days you really did see some purge

like activity. very heavy volumes and outflows from the big etfs. all of that is a precondition for, fine. we should at least bounce here it is not necessarily going to be decisive one way or the other. almost whatever happens today i think we are in this mode kind of like january 2018 when we fell very steeply off an all-time high when you had an expensive and over bullish backdrop that, you know, maybe you've capped the market for a while. you have to at least shop around the immediate decline happened within a few days. it wasn't something where you really went on a slope lower for weeks and months >> so a lot of sentiment has played into the market action and for weeks you had people coming on saying the market is being too complacent about the risk around coronavirus. and now we're asking is the market too alarmed about the risk around coronavirus? >> yes everything had a price i do think that the market was too complacent about things in general. too complacent that the script was going to be followed in terms of this economic recovery on time and all the rest of it

was the market just 8% too complacent last week is that kind of the way -- we don't know >> how can we possibly know without knowing the trajectory of this virus, how many people are going to be affected in the u.s., what that is going to look like in terms of consumer and economic behavior? >> you don't that's why i don't think this is something that ends on a headline or a development or a policy measure or anything like that it ends when the market has bled itself enough and people got scared enough and priced in a very dire scenario maybe it's already happened and maybe it's lower today the furious bond rally has paused it's maybe exhausted itself. when that happens, when yields are no longer making new lows they become friendly again then they become a backdrop of really cheap money and really low rates and low hurdle rates and valuations on equity start to look better i do think that is the push pull we'll be in for a little while >> how about the fed we are getting this bounce without them really having to surrender or show any fear >> not right now when the ten year goes to one

three and mortgage rates largely follow it and all the rest of it i think that is part of the game not clear to me that the fed is looking for an opportunity to pull forward anything it might do down the road i really do think they'll want to see it in the numbers somewhere. before you kind of proactively decide this is going to be something -- i do think one they are looking at is financial conditions you saw credit spreads really start to gap higher and continue up they are better today that is the kind of thing they feel as if they have the antidote for that and maybe that would be the thing where you can kind of take some of the friction out of the markets but can't necessarily solve the supply issues. >> one of the questions asked in a note today, is there any reason to think that buying the dip won't work when it has worked every time post crisis? we don't know how long this is going to last but investors certainly have been rewarded before for buying. >> without a doubt the one time that in this entire cycle where really it wasn't the

case was october of 2018 when you had a move like this off the highs in september of that year and you got your quick down 10% and people thought that might have been it and you had another 10 plus to go. that was because the fed was kind of off sides and all the rest of it and financial conditions didn't cooperate. i do agree with that point if you look at all of the forward looking kind of indicators of what history says after you have one of these types of pretty comprehensive declines over two days over a multi month period you don't always catch the low but over a multi month period the odds go in your favor, look, if you don't get a recession. everything is about not getting in a recession essentially we've never had two 3% down days when the market wasn't already in a trend -- >> the difference between h1n1 we had already discounted trouble. >> exactly a very different field position market wise when you had that. >> let's check in for the latest

on the coronavirus headlines back at headquarters >> reporter: hey, david. brazil confirming its first case of the novel coronavirus this morning in a sao paulo resident who traveled to northern italy earlier this month, the first confirmed case in latin america brazil now tracking 20 suspected cases in the country according to a health ministry official. the news comes as the world health organization marked a milestone today. for the first time new cases outside of china at 427 have surpassed those reported in china at 411 the w.h.o. citing sudden increases in cases in italy, iran, and korea. there are cases in kuwait and other cities and italy algeria, austria, germany, spain, switzerland. still the w.h.o. noting 14 countries haven't reported new cases for more than a week nine countries haven't reported a case for more than two weeks saying for now those countries have succeeded in containment but that the virus could return and all countries must prepare for a potential pandemic w.h.o. also saying one of the biggest challenges it faces is

that too many affected countries are still not sharing data meanwhile here in the u.s. the white house planning a 6:00 p.m. news conference with the cdc on the novel coronavirus tonight. it comes after the cdc yesterday said it is a matter of when not if the disease starts spreading in the u.s and said americans need to prepare for potential significant disruptions to daily life health sect tri alex azar now testifying on the hill yesterday emphasized u.s. cases other than those in people evacuated from wuhan, china and "the diamond princess" cruise ship have remained at 14 for two weeks sara >> meg, thank you. fast food giant wendy's out with earnings today. our kate rogers joins us for an exclusive interview with wendy's' ceo kate >> thank you so much we are joined this morning by the wendy's ceo. thank you for having us. >> good morning kate thanks for being here. >> we have earnings news and a breakfast roll out to talk about but first have to hit the coronavirus. the majority of your business is based here in the united states. people are talking about a when

not if sken air i doncenario wis becoming more widespread what can be done and how can you safeguard your business and employees? >> as you know 95% of our business is north american based so we aren't seeing the international impacts. we are clearly watching our supply chain closely to make sure we don't have any business disruption from sourcing around the globe but we are in a great spot and continue to monitor the cdc, continue to stay abreast of the situation here we always continue to make sure our restaurants are in a great position to support customers day in and day out we are well prepared and will continue to monitor the situation. >> you are also expanding internationally with a real focus on the yuunited kingdom t start. as cases grow overseas is it giving you any pause and are you re-evaluating anything >> no. we know our core market is the place to grow. we have markets in the asia pacific region we aren't in china today but in japan and the philippines. they have been impacted by

tourism but still have a strong business in those markets. we get into the uk, we will have company restaurants opened over the next 12 months but, no, we're all in on our international bets and will continue to monitor the situation but we don't see those disrupting our plans today >> so a breakfast launch is coming next week breakfast wars are heating up. mcdonald's has said they absolutely have to win at breakfast. if and when wendy's wins at breakfast which i'm sure the company believes it will are you concerned at all that people don't come in for lunch and dinner and you potentially take some of that business away >> we haven't seen that impact there is a lot of concern around cannibalization and will folks who come in for breakfast not show up at lunch they are only coming towendy's five and a half times a year so if we can get a few more visits during the breakfast day part on the days they're not coming for lunch and dinner we see it as a big opportunity to drive traffic and more frequency into our restaurants. >> you've also tried breakfast before you have skeptics on wall street why will it work this time >> we got a system that is all

in we've never launched breakfast nationally we got a national launch march 2nd. next week on full air nationally we got a whole franchise system that is all in we're trained. we're staffed. we're ready to create a great experience for customers to ingrain that habit day in and day out. i think that is the big difference that we've day out. i think that's the big difference we have a system fully committed to being successful in breakfast and that's part of our long-term guide. >> we chatted with your ceo yesterday and he said he talked to beyond meat and others about partnerships going forward do you think this is a fad or here to stay when will wendy's get in on the action >> we think it's here to say and we will get into it with our way of high quality. we have a plentiful burger you will see in canada we tested the black bean burger and got that simplified from an

operational perspective. we tested a plant-based chicken sandwich this year we have a toolbox. we think it's a trend to stay. folks are looking for variety. it's not meat protein looking to shift, they're just looking for variety in their diet and help drive frequency if we have those items in our restaurants. >> todd, thank you so much for having us here today and joining us this morning. >> i appreciate your time. >> david, back to you. >> thank you, kate let's go to jon fortt to see what's coming up on "squawk alley." >> virgin galactic has been a rocket so far this year, losing some altitude today. down 5 1/2%. we will have the ceo post earnings about what's coming up the next stage that's coming up on "squawk alley. legendary terrain in telluride,

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welcome back to "squawk on the street." investors have been looking towards the bigger relative dividend yields in real estate stocks as interest rates have fallen and hit record lows this week now i will send it back downtown to you at the new york stock exchange. >> thank you very much down 14, as we said earlier, close to session highs looking at faang, story of the day so far apple, huge help, vix 25 is encouraging. oil hanging on to 50 and at some pointed out, maybe signs of exhaustion. >> if you're tolling up the damage, 6% off the high at the s&p. we heard from dr. fauci from nih this hour. we know investors pay attention

to his words he was somewhat reassuring at least after the severe warning from the cdc about americans being prepared he said look, we don't know how many cases will come here. this is a pandemic as it is looking, you will likely see cases but he definitely did not unsound alarm. don't you think? >> maybe it's his presentation opposed to his word. he did agree the cdc would come here but you're right, he did seem somewhat reassuring. >> one thing is for sure, the echo of all of this, even contained today, will remain with travel companies. i'm looking at lufthansa now and the degree they're slashing projects and expenses is breathtaking you have delta cutting flights today. >> to south korea. >> and way beyond travel just today food and beverage companies deknown and diageo warning it will have an impact on the full year. >> yesterday we saw significant reversal after an opening that was up early so the closing bell becomes very

important. >> it's always important, david, but a dramatic final hour of trade over the last few sessions, especially so lately we will talk with papa john's ceo rob lynch, and talk about consumer behavior at what to expect in the u.s. and what he's seeing in some of the international location and we have former acb president jean-claude as well. >> the dow up almost 400 "squawk alley" begins in a moment - [narrator] at southern new hampshire university,

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